The following information concerns production in the Forging

The following information concerns production in the Forging Department for November. All direct materials are placed into the process at the beginning of production, and conversion costs are incurred evenly throughout the process. The beginning inventory consists of $72,600 of direct materials.

Cost per equivalent units of $11.90 for Direct Materials and $2.70 for Conversion Costs.

Based on the above data, determine each of the following amounts.

If required, round your interim calculations to two decimal places. Round final answers (a-c) to the nearest dollar.

a. Cost of beginning work in process inventory completed in November.
$

b. Cost of units transferred to the next department during November.
$

c. Cost of ending work in process inventory on November 30.
$

d. Costs per equivalent unit of direct materials and conversion included in the November 1 beginning work in process. If required, round your answers to two decimal places.

e. The November increase or decrease in costs per equivalent unit for direct materials and conversion from the previous month. If required, round your answers to two decimal places.

ACCOUNT Work in Process—Forging Department	ACCOUNT NO.
Date	Item	Debit	Credit	Balance
Debit	Credit
Nov.	1	Bal., 6,000 units, 50% completed			80,400
	30	Direct materials, 55,000 units	654,500			734,900
	30	Direct labor	65,230			800,130
	30	Factory overhead	90,074		?		890,204
	30	Goods finished, ? units			?
	30	Bal., 4,800 units, 90% completed			?

Solution

UNITS TO ACCOUNT FOR: Beginning Work in Process units 6,000 Add: Units Started in Process 55,000 Total Units to account for: 61,000 UNITS TO BE ACCOUNTED FOR: Units completed from Beginning WIP 6000 Units started and completed 50,200 Ending Work in Process 4,800 Total Units to be accounted for: 61,000 Equivalent Units: Material Cost Conversion % Completion Units % Completion Units Units completed from Beg. WIP 0% 0 50% 3,000 Units started and completed 100% 50,200 100% 50,200 Ending Work in Process 100% 4,800 90% 4,320 Total Equivalent units 55,000 57,520 COST PER EQUIVALENT UNIT: Material Conversion Total cost added during the year 654,500 155,304 Equivalent Units 55,000 57,520 Cost per Equivalent unit 11.9 2.7 TOTAL COST ACCOUNTED FOR: Units Completed from Beginning WIP (6000 units) Equivalent unit Cost per EU Total Cost Beginning Cost 80400 Material 0 11.9 0 Conversion Cost 3,000 2.7 8100 Cost of units completed from Beg WIP 88500 Units started and Transferred out (50200 units) Equivalent unit Cost per EU Total Cost Material 50,200 11.9 597380 Conversion Cost 50,200 2.7 135540 Total Cost of Units completed and transferred out: 732920 Ending Work in process (4800 units) Equivalent unit Cost per EU Total Cost Material 4,800 11.9 57120 Conversison Cost 4,320 2.7 11664 Total cost of Ending Work in process: 68,784 Req a: Cost of Beginning WIP complteed: 88500 Req b: Cost of Units transferred outv (88500+732920) = 821420 Req c: Cost of Ending inventory: $ 68784 Req d: Total beginning WIP cost 80400 Less: Material cost 72600 Converison cost 7800 Material per unit (72600/6000): 12.1 Conversion (7800/3000) 2.6 Rreq e: Change in material cost per unit Decrease 0.20 Change in conversion cost perr unit Increase 0.10